The Converging Paths of Mobile Advertising

Developments in Content, Direct Response, Targeting and Tracking Are Starting to Merge

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One of the world's great paradoxes is that the more things diverge, the more they converge. It's not just the French expression, "Plus ca change, plus c'est la meme chose," whic is commonly, if imperfectly, translated as, "The more things change, the more they stay the same." Rather, it's that the more things change, the more they tend to become the same.

This was especially evident at this year's Consumer Electronics Show, where I joined Digital Hollywood's smartphone and tablet track for a session focused on mobile advertising. There, key trends in the field seemed to diverge and converge at the same time.

Here are three examples of this, based on some of the more interesting topics that came up during the panel:

Content vs. Advertising. For a panel about advertising, it was surprising to hear so much conversation about content. There was very little discussion about ad formats, and quite a bit about what kinds of content work as advertising. I noted on stage that the biggest proponent of this mindset was Google, which says that its mission statement is "to organize the world's information and make it universally accessible and useful." When I first heard that years ago, I wondered how ads fit in with the mission, but Google execs proved convincing when noting that ads were valuable information, especially when run well.

Google proved to be particularly prescient in this regard. Twitter later encouraged marketers to repurpose their content (tweets) as ads, and Facebook followed suit. Many forms of native advertising make it even harder to distinguish what's content and what's advertising. Meanwhile, some of the top content from the Consumer Electronics Show, as tracked by Keyhole, were product images posted by major car brands -- essentially ads that had no paid media cost.

Sexy vs. Wonky. Opportunities for compelling creative and direct response both keep getting better, which will entice marketers to invest more heavily in both areas -- and blur the lines between them further.

In mobile media, branding and direct response don't compete with each other for marketers' resources. Mobile branding tends to compete with traditional media such as TV, while mobile direct response budgets may come from areas such as direct mail, affiliate marketing and, potentially, search.

And creative opportunities abound, thanks to larger-reach options with mobile photography and video. Instagram is the best, most prominent new example here, while ad-free Vine gives marketers new ways to turn ads into stories. On the performance side, one important emerging area is deep linking, which allows ads to detect whether consumers have a certain mobile app so that it can direct consumers to specific pages deep within that app. Two companies to watch here are Google, whose panelist George Meredith acknowledged the company's avid exploration of the field, and URX, a startup with strong expertise here.

Demand creation (branding) ads and demand capture (performance) ads don't live independently. Creative formats can now be measured more effectively, while direct response programs tend to perform better when there's more engaging creative triggering the interactions.

Convenient vs. Creepy. The more mobile marketers explore the current frontiers of what they can do with targeting and tracking, the more they will have to determine how they can provide value without scaring off potential customers. Deep linking offers a relevant example. Imagine you're searching for a new camera, and you see an ad for Target. Such ads normally direct people to the advertiser's mobile site, or potentially an app store to download the app. With deep linking, the ad would detect that the consumer has Target's app and then send him or her directly to the digital camera section within that app, or to a page in the app hosting an offer for a certain camera.

If you tell someone that ads can now sniff out what apps they have on their phone and use that for targeting, it can sound like a gross invasion of privacy. But that same person clicking the Target ad will probably appreciate shopping within the app he chose to install on his phone, rather than navigating around the mobile website. A populace nominally aware of the broad strokes may collectively rebel; it seems ripe for class-action lawsuits and Congressional hearings.

Yet offering a more convenient, seamless experience without polling people on what they want may well be what works best. In the old days, collecting creepy amounts of information only benefited marketers, leaving consumers little reason to like it. Now, in mobile, what seem to be the creepiest developments also tend to be what provide the most convenience.

As mobile marketing heads in so many converging and diverging directions at once, this group of panelists was especially incisive. Thanks are due to fellow presenters: Google's George Meredith, Beachfront Media's Frank Sinton, Blast Radius' Shawn Fenton, Possible's Andrew Solmssen, Time Warner Cable Media's Fred Bucher, Skype's Al Kallel and IBB Consulting's Jonathan Weitz.

David Berkowitz is CMO at MRY.

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